Platinum stocks rise despite strike

Companies / 10 February 2014, 08:00am

Bloomberg

Platinum stocks held sway on the JSE last week, ending it with some marginal, but nonetheless surprising, gains despite there being no end in sight to a harsh strike that enters its fourth week today, crippling production at Anglo American Platinum (Amplats), Impala Platinum (Implats) and Lonmin.

The beginnings of violence where one person was shot dead and another seriously injured did no more than scratch off 0.14 percent to R421.40 from Amplats while Implats gained 1.63 percent to R114,59 and Lonmin 0.36 percent to R56.19.

The industry’s reticence will face more tests today as once again the Commission for Conciliation, Mediation and Arbitration (CCMA) attempts to help platinum executives and the Association of Mineworkers and Construction Union (Amcu) find middle ground.

Talks between the parties broke down on Wednesday after union members dismissed an offer for pay increases of as much as 9 percent a year.

South Africa’s annual rate of inflation was 5.4 percent in December last year.

Mining companies have dismissed a proposal from the state broker to more than double workers’ basic pay to R12 500 within three years.

“We were amazed that the employers rejected the CCMA recommendation and stuck to their 9 percent,” Amcu’s president, Joseph Mathunjwa, said last week.

“This made discussions on a possible settlement difficult and left Amcu with no option but to continue with strike action.”

A union official died on Friday after police used rubber bullets and stun grenades to disperse striking workers at the Union mine owned by Amplats in Limpopo.

The incident happened as police and mine security tried to block a road towards an area where Amcu members were picketing, Mathunjwa said.

He also blamed individuals belonging to “dark forces” disguised as Amcu members for instigating violence.

“Instead of maintaining law and order, the police have been transformed into a super killing machine,” Mathunjwa said.

Police investigating smoke at a settlement next to the mine were attacked and pelted with stones, Brigadier Hangwani Mulaudzi, the spokesman for the SAPS in Limpopo, said.

Another employee was assaulted earlier last week on his way to Amplats’ Khuseleka mine “and remains in a critical but stable condition”, the company said, while an excavator and a vehicle were set alight and 14 other vehicles were damaged, according to the statement.

Amcu has called more than 70 000 workers on a strike that has cost the top three producers about R200 million a day since January 23.

South Africa accounts for about 70 percent of global output of the metal, used in jewellery and catalytic converters for vehicles.- Additional Reporting by Staff Writer